EL SEGUNDO, CALIF. (Sept. 5, 5 p.m. ET) — Bioplastics maker Cereplast Inc. has received a $5 million investment as it works to recover from a half-year that was filled with production issues and a major sales drop.
Institutional investment firm Ironridge Technology Co. of San Francisco made the investment in Cereplast, which is based in El Segundo. Ironridge will receive preferred stock in Cereplast in exchange for the investment.
In a news release, Cereplast Chairman and CEO Frederic Scheer said the investment will allow his firm to restart its production schedule and access raw materials.
Cereplast also needed funding to support its recently opened office in Hyderabad, India. Scheer said interest from potential customers there could total more than 4 million pounds.
“I want to thank the team at Ironridge for supporting Cereplast during this critical time,” Scheer said in the release.
Cereplast weathered the first half of 2012, when its sales fell more than 90 percent to $305,000. The firm also posted a first-half loss of $6.3 million after losing $4.1 million in the same period in 2011.
On Wall Street, Cereplast's per-share stock price began the year around $1 but closed Sept. 5 on Nasdaq at 19.3 cents.